Trade-Ideas LLC identified Tetraphase Pharmaceuticals ( TTPH) as a weak on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Tetraphase Pharmaceuticals as such a stock due to the following factors:

  • TTPH has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $6.1 million.
  • TTPH has traded 82,948 shares today.
  • TTPH is trading at 3.07 times the normal volume for the stock at this time of day.
  • TTPH is trading at a new low 4.04% below yesterday's close.

'Weak on High Relative Volume' stocks are worth watching because major volume moves tend to indicate underlying activity such as material stock news, analyst downgrades, insider selling, selling from 'superinvestors,' or that hedge funds and traders are piling out of a stock ahead of a catalyst. Regardless of the impetus behind the price and volume action, when a stock moves with strength and volume it can indicate the start of a new trend on which early investors can capitalize (or avoid losses by trimming weak positions). In the event of a well-timed trading opportunity, combining technical indicators with fundamental trends and a disciplined trading methodology should help you take the first steps towards investment success.

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More details on TTPH:

Tetraphase Pharmaceuticals, Inc., a clinical-stage biopharmaceutical company, develops various antibiotics for the treatment of serious and life-threatening multi-drug resistant infections. Currently there are 2 analysts that rate Tetraphase Pharmaceuticals a buy, no analysts rate it a sell, and 5 rate it a hold.

The average volume for Tetraphase Pharmaceuticals has been 979,500 shares per day over the past 30 days. Tetraphase has a market cap of $219.3 million and is part of the health care sector and drugs industry. The stock has a beta of 0.50 and a short float of 20% with 4.80 days to cover. Shares are down 43.3% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Tetraphase Pharmaceuticals as a sell. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, weak operating cash flow and generally disappointing historical performance in the stock itself.

Highlights from the ratings report include:
  • The company, on the basis of change in net income from the same quarter one year ago, has underperformed when compared to that of the S&P 500 and greatly underperformed compared to the Pharmaceuticals industry average. The net income has significantly decreased by 27.0% when compared to the same quarter one year ago, falling from -$14.21 million to -$18.04 million.
  • Net operating cash flow has decreased to -$20.85 million or 17.48% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
  • TTPH's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 84.56%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Pharmaceuticals industry and the overall market, TETRAPHASE PHARMACEUTICALS's return on equity significantly trails that of both the industry average and the S&P 500.
  • TETRAPHASE PHARMACEUTICALS has improved earnings per share by 10.9% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, TETRAPHASE PHARMACEUTICALS reported poor results of -$2.48 versus -$1.38 in the prior year. This year, the market expects an improvement in earnings (-$2.33 versus -$2.48).

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